Understand the CRM system

Have you ever heard of Dynamics 365 provided by Microsoft? Microsoft Dynamics 365 is a business application that integrates and utilizes data from various departments such as sales, marketing, accounting, general affairs, and human resources into a single application.

It used to be divided into Dynamics CRM, a product for sales, service, and marketing that required customer relationship management, and ERP (accounting, supply chain, project, and human resource management) products called Dynamics AX and NAV.

Today, all of these capabilities are integrated into a single application called Dynamics 365, which has evolved into a business application that is available both in the cloud and on-premise.

Microsoft is often associated with Office products, but it also boasts a large share of ERP and CRM systems. In this article, I would like you to understand the history and the necessity of CRM systems before we touch on Dynamics 365 as a CRM system.

What is CRM?

CRM stands for Customer Relationship Management. In Japanese, it means Customer Relationship Management. It refers to a management strategy and method for building, managing, and analyzing relationships with customers, with the aim of increasing corporate sales and profitability through improved customer satisfaction.

Systematization of CRM

In fact, the term “CRM” has been around since the 1990s. It is a method that was born with the change of the times from a product-oriented corporate strategy to one that places more importance on the relationship with society and customers.

CRM was first systematized in the 2000s. With the development of technology such as personal computers and the Internet, there was a growing need for systemization in order to accumulate, analyze, and utilize vast amounts of data. This led to the introduction of ERP systems such as Microsoft, SAP, Oracle, etc., mainly by consulting firms, and the introduction of CRM systems in conjunction with ERP.

The value of centralized information

When CRM is implemented as a customer management system, customer information will be managed in one system. It then becomes clear that customer information never comes from a single channel. Customer information is added and updated from various channels such as sales activities (diving, exchanging business cards, phone calls, referrals, etc.), marketing (seminars, e-mails, commercials, advertisements, etc.), customer support, and services.

The biggest advantage of having a single master CRM system to manage customer information, which used to be managed individually by each department or division of an organization, is that it enables the person in charge of the division to accurately grasp the current status of the customer and how to act in the future from there.

For example, let’s consider the following situation.

Example: Dealing with existing customers who are dissatisfied with the product

A customer purchased a product as a new customer through an introduction from a long-time customer. However, there is something wrong with the product they purchased, so they contact the customer support department and they are in the process of replacing the product. The customer feels dissatisfied with the product to no small extent.

When a sales representative makes an appointment with a customer to introduce a new product, there is one thing that needs to be checked before the appointment. That is to check the response history of the customer support department to understand the complaints received from the customer and the status of the response.

It would be great if the sales representative could check the status with this support department representative in real time, but what if the support department representative is not available on the day of the customer visit? A sales representative who does not know the situation will not be able to win the customer’s heart without an apology for dissatisfaction with the product. It may even lead to the loss of future business.

If the CRM system manages the “now” of the customer, at least the sales representative can check the response status of the support department. Then, the sales representative can make an appropriate decision on the “next” action.

Why do you need a CRM system?

In the case of the above example, some people may think that communication between the sales and support departments should be sufficient without using a CRM system. This may be true. However, it is easy to make mistakes when communicating only between people. Even if you leave a memo or a sticky note, there is a risk that it will be lost or that what you wrote will be misunderstood.

There is a way to manage customer information in Excel and keep it in a shared folder so that the person in charge can check it. There is no need for complicated settings, and many companies are still using the familiar Excel to manage information.

So what exactly is the problem?

Example: Dilemma between Sales Department and Product Management Department

The sales clerks interviewed the sales representatives and managed all the detailed information about the customers they collected during their sales activities in Excel. The information included basic customer information, family structure, hobbies and preferences, business partners and management status, and which products they recommended.

On the other hand, products were managed by the administration department in a separate Excel file. In addition to the product name, features, cost and selling price, and inventory, information on cross-selling and up-selling is also managed in detail. The product information is updated every year by the department that develops the products, so the Excel information is updated every time.

During the fiscal year end every year, salespeople are busy trying to achieve their goals. They make full use of up-selling, cross-selling, and sales to sell their products one after another. At the same time, the product management department is also dizzyingly busy. This is because they have to keep updating the information from sales, such as checking the inventory of products and adjusting sale prices, and provide the latest information to sales correctly.

In the Product Management Department, we increase the number of staff to prepare for the busy season. However, no matter how many staff we increase, we always end up making mistakes in pricing and inventory management, which leads to complaints from the sales department. The sales department works hard to sell the products, but they always have to apologize to some customers for the lack of inventory.

Managing information in Excel is not management.

The above phenomenon is very common, and information management in Excel is not really management at all. If there is no master management of information, inconsistencies will occur, and data inconsistencies will always lead to problems.

In addition, problems are not limited to customer relationships; Excel management cannot recover from accidental changes or deletions of data because no history is kept, nor can it prevent information leakage due to unauthorized access. It is essential for an organization to supplement its internal control system with a system.

Which CRM system do you recommend?

Now that we understand the role of CRM systems in managing relationships between customers, products, employees, services, and various other information, we can understand the “now” and “future” of a company. So, which CRM system is recommended?

The two major CRM systems are Salesforce and Dynamics 365. And here I would like to take a deep dive into the appeal of Dynamics 365.

In the next section, I will explain why you should choose Dynamics 365.